What WSU, media didn’t tell you about Mike Ilitch School of Business

When Wayne State University broke ground on the $50 million Mike Ilitch School of Business on Wednesday, school officials and the media left out some key details about the burden on taxpayers and students.

WSU President Roy Wilson

More than six months after the university’s Board of Governors approved the construction project without details of the agreement,WSU President Roy Wilson asked the board to pitch in an additional $9 million for the “gift.” The board agreed, and one month later it approved a tuition increase of 4.1%, citing money problems.

Top university officials declined to discuss why the $9 million payment was necessary after approving the “gift agreement” with Ilitch, who is a billionaire and beneficiary of hundreds of millions of tax dollars for his projects.

WSU officials also declined to release a copy of the “gift agreement,” which outlines the university’s financial obligations over the building.

It’s a win-win for Ilitch, who is building a Red Wings arena next to the new school using more than $250 million in tax dollars. The $40 million donation allows Ilitch to write off the gift on his taxes, and it gives his company, Olympia Entertainment, the opportunity to say it is closer to reaching its goal of spurring development around the arena. Never mind that the property won’t be taxed like many of the buildings Ilitch operates in Detroit.

After university officials declined to release a copy of the “gift agreement,” which impacts taxpayers, Motor City Muckraker on Wednesday sent a Freedom of Information Act request to WSU President Wilson, Vice President and Chief of Staff Michael Wright and General Counsel Louis Lessem.

Soon after, Wayne State responded by saying it would need a 10-day extension – a move that keeps the agreement out of the public’s hands, at least for now.

Gift agreements are public records because they spell out the responsibilities of taxpayers and the university.

When the Ilitch deal was initially approved, at least one board member, Dana Thompson, abstained because she wasn’t given enough time to review the plan.

“As a former commercial real estate attorney who practiced at Morrison & Foerster in California, one of the largest law firms in the nation, I don’t approve deals that I don’t have ample time to review,” Thompson wrote in response to our questions on the day of the groundbreaking. “My goal as a member of this Board is to ask questions to ensure that the project completes on time and on budget and that we’re not in for any additional surprises like the $9 million we just approved in May.”

Wayne State has a history of declining to release public information and often has an adversarial relationship with the media.

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Steve Neavling lives and works in Detroit as an investigative journalist. His stories have uncovered corruption, led to arrests and reforms and prompted FBI investigations.

dirtydog1776

It’s called crony capitalism. It makes rich people richer, raises taxes, chases away productive businesses and citizens, spawns a corrupt, elitist bureaucracy and destroys the democratic process. End all corporate (and individual) welfare now and there might be some hope for Detroit.

dirtydog1776

It’s called crony capitalism. It makes rich people richer, raises taxes, chases away productive businesses and citizens, spawns a corrupt, elitist bureaucracy and destroys the democratic process. End all corporate (and individual) welfare now and there might be some hope for Detroit.

dirtydog1776

Ya gotta love that crony capitalism. Expect a lot more when Trump or Hillary are elected President……..if the country doesn’t explode in revolution first.

dirtydog1776

Ya gotta love that crony capitalism. Expect a lot more when Trump or Hillary are elected President……..if the country doesn’t explode in revolution first.

Geoff Gariepy

Mike Illitch and others like him are a plague on the City of Detroit with their taxpayer-funded projects. It’s time to just say no to giving billionaires public money to further their own pursuits after wealth. Let these guys come up with the dough from their own pocket!

Geoff Gariepy

Mike Illitch and others like him are a plague on the City of Detroit with their taxpayer-funded projects. It’s time to just say no to giving billionaires public money to further their own pursuits after wealth. Let these guys come up with the dough from their own pocket!

Tom

Mike Ilich The Gift to Detroit that keeps on Taking.
100+ years ago when Detroit was growing organically was everybody that built a manufacturing facility or opened a store given tax incentives?

Much of what happens with downtowns small to big these days is not organic business.
Maybe I’m wrong but I’m sure Whole Foods would have been profitable without the tax breaks along with the new Target store on deck.

Earlier on Detroit neighborhoods paid for much of the downtown projects through reduced services, that cow got milked and died. Neighborhoods vanquished but look at that downtown ripe for gentrification for which services are then dedicated.

All for the few who covet the privilege and protection the United States gives them but don’t want to pay fair tax or hire fellow citizens to manufacture the products marketed here or send their offspring to war.
Privileged Takers

javierjuanmanuel

I love when muck hits them with a FOIA. You know they are pissed for a month when he does that.

Syri Simpson

Beware of Geeks bearing gifts. This sounds like the over-budget, behind schedule Street Car tax-payers were “gifted” with. Another development turning around to bite tax-payers in the butt. So we will have a better building which fewer students can afford to attend. Those who do have the means and whose transit needs were already met, can make their leisurely way to a bright future built on a superior education riding the Street Car sans Undesirables

javierjuanmanuel

Its all loans, they can afford it.

40 years ago kids paid their way through college waiting tables, painting, being a life guard.

Teachers and administrators with their lofty pay and bennies now make sure you pay for school till your mid 40s.

Third World Detroit

BOG. That’s perfect.

franshor

Thanks, Steve, for your work on this and other under-reported matters in Detroit. As a recently retired WSU faculty member (who will be running for one of the two seats on the WSU BOG as a Green Party candidate), I plan to raise issues like this that have transformed WSU into another corporate entity that turns its back on the working class that traditionally had access to WSU. Indeed, I taught for over 30 years in the premier program for working adults at WSU – an open admissions degree granting program – that the university “terminated with extreme prejudice” in 2007. Four of the six Democrats on the BOG voted to kill the program and deny adult workers in the Metro Detroit area access to the university. Instead of raising the tuition of already debt-ridden students, we need to create a debt free campus for the students with subsidies, not for billionaires like Illitch, but for working class students whose resources are very limited. I plan to run on these and other issues that will challenge “business as usual.”

Stop the inflation of tuition, stop building new buildings. I think in 20 years, these building’s will almost for sure be half empty.

They raise tuition double, even triple the rate of inflation

javierjuanmanuel

the free university that accepts everyone, even people who got Ds in highschool got a 14 on act, maybe a 12, is no way to sell the school to kids who get 28-32 on the act and took AP classes, and are willing to plunk down some money.

Not saying people who screwed off in highschool or maybe have sub par IQ should not go to school, not even saying for the right guy to make it free, just do not make it at the school they are trying to charge half the metro area full price, and then send that kid away to apply for a nice job, when many will think the school is for morons who cannot pay and scrape 2 nickles together or get a loan which is impossible.

Make a new school perhaps, maybe you can teach there for free since you love free stuff so much.

Maybe donate your pension as well. Almost no one gets a pension, your pension is worth, what ? 3-4 million bucks ?

dirtydog1776

More subsides? That is business as usual. That is the thinking that has gotten WSU into the predicament it is in now. By the way, would you care to announce to the public what your pension is worth? Ironic, hey? Someone who has been feeding on the public teat all his life, asking for more sacrifice from the few taxpayers left in Detroit area. The pigs eating with the farmers.

dirtydog1776

More subsides? That is business as usual. That is the thinking that has gotten WSU into the predicament it is in now. By the way, would you care to announce to the public what your pension is worth? Ironic, hey? Someone who has been feeding on the public teat all his life, asking for more sacrifice from the few taxpayers left in Detroit area. The pigs eating with the farmers.

imara hyman

As a fee paying student of Wayne State University, I thank you for this information. for the longes time, it just pissed me off that that big Ilitch school of business banner defaces the beauty of that particular building. And i often thought to myself, what are they going to teach, how to get land for a dollar, not pay your business taxes and how to get taxpayer money to fund your projects…seems like this is worthy of some student action….

javierjuanmanuel

No business school teaches you that. They teach you how to work for a fortune 500 company thats it.

Did the education school teach president wilson to try to do whats best for the kids, or what gets his face in the paper, invited to a better class of cocktail parties, golfing with big shots, rides on jets, trips out of town, keys to ski lodges and beach homes etc ?

imara hyman

sorry you misread my sarcasm…

Jack Ramsey

Ilitch, ever the skillful leech. It would be interesting to know approximately how much his investments in Cass Corridor real estate–made with the deliberate intent of depreciating their value by letting them get run down, over the course of 2 to 3 decades–ultimately cost Wayne State University and the city of Detroit over the years. Think it would equal $40 million?

javierjuanmanuel

Yes. But what was the alternative?

Cass was a shit hole in the 60s, and where did you want the new arena or baseball stadium etc ?

Canton? Macomb township?

Seriously. If they built up tons of successful businesses and high rises, you cannot get them to sell, and you cannot knock down 20 buildings 20 stories tall, new, filled with people making money